HealthNEWS

HCA beats Wall Street expectations in Q2 after earlier dip in guidance

By the numbers

 

$1.2B

Internet revenue fell almost 20% yr over yr

 

$14.8B

Income rose about 3% yr over yr

 

1.2%

Decline in same-facility admissions in comparison with prior-year interval

HCA Healthcare inventory was up about 12% in Friday pre-market buying and selling because it reported second quarter earnings outcomes that beat Wall Avenue expectations.

The Nashville, Tennessee-based for-profit chain reported $14.8 billion in income in comparison with $14.4 billion within the second quarter of 2021, beating expectations by 0.6%, in keeping with a report by SVB Securities. Adjusted EBITDA got here in at $3.04 billion, almost 10% above SVB’s mannequin.

Volumes: Executives on HCA’s Friday earnings name reported that volumes have been returning to pre-pandemic seasonal tendencies, although they have been much less optimistic than in earlier quarters for a lift in volumes pushed by pent-up care delayed by the COVID-19 pandemic. Similar-facility emergency room volumes remained excessive, rising 7.3% in Q2 in comparison with the identical time final yr. In the meantime, same-facility inpatient surgical procedures declined 2.3% whereas similar facility outpatient surgical procedures fell 1.4% yr over yr.

Labor prices: Within the first quarter of this yr, HCA lowered its full-year expectations citing ongoing labor challenges that hadn’t improved as swiftly as executives predicted. Contract labor use peaked within the first quarter. Within the second quarter, contract labor use fell together with charges for these employees. Contract labor use and charges are anticipated to proceed declining steadily via the yr, executives mentioned on the earnings name.

Nonetheless, bills for salaries and advantages have been up 6% yr over yr. Chief Monetary Officer Invoice Rutherford mentioned the corporate made “pretty sizable” wage changes throughout the corporate this time final yr and plans to present nurses one other wage adjustment within the single digits this yr. Turnover was down 20% within the second quarter in comparison with the primary, Rutherford mentioned.

Galen Faculty of Nursing: HCA opened its eighth nursing faculty campus in Asheville, North Carolina, in June and plans to open three extra this yr. The hospital chain acquired a majority stake in Galen in 2020 in a bid to spice up its long-term pipeline of recent nurses and different healthcare employees as shortages of nursing educators and scientific websites pose challenges to techniques throughout the nation. HCA envisions having campuses in all main communities the place it has hospitals sooner or later, CEO Sam Hazen mentioned. When requested what number of Galen graduates are taking full-time positions with HCA, Hazen mentioned it is too early to quantify, and at present solely two colleges function in markets with HCA hospitals — in Tampa, Florida, and San Antonio, Texas.

Steerage: After decreasing full-year expectations within the first quarter, HCA made no point out of ahead steerage “more likely to be interpreted as a reiteration of the prior vary,” SVB Leerink analysts wrote in a be aware.

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